Exhibit 10.3
PUBLIC COMPANY
STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT (this "Agreement"), dated as of January 27,
2009, is by and among NitroMed, Inc., a Delaware corporation ("Public Company")
(only with respect to Section 2(b) and Section 10(q)), Deerfield Private Design
Fund, L.P., a Delaware limited partnership, Deerfield Private Design
International, L.P., a British Virgin Islands limited partnership, Deerfield
Special Situations Fund, L.P., a Delaware limited partnership, Deerfield Special
Situations Fund International Limited, a British Virgin Islands corporation,
NTMD Parent Acquisition Corp., a Delaware corporation, NTMD Acquisition Corp., a
Delaware corporation (collectively "Merger Partner"), and the undersigned
stockholder ("Stockholder") of Public Company.
WHEREAS, concurrently with the execution and delivery of this Agreement,
Public Company, NTMD Acquisition, Corp., a Delaware corporation and a wholly
owned subsidiary of Merger Partner (the "Transitory Subsidiary"), and Merger
Partner have entered into an Agreement and Plan of Merger, dated as of the date
hereof (as it may be amended or supplemented from time to time pursuant to the
terms thereof, the "Merger Agreement"), which provides for the merger (the
"Merger") of the Transitory Subsidiary into Public Company in accordance with
the terms of the Merger Agreement;
WHEREAS, Stockholder is the beneficial owner (as defined in Rule 13d-3
under the Exchange Act) of such number of shares of each class of capital stock
of Public Company as is indicated on the signature page of this Agreement; and
WHEREAS, in consideration of the execution and delivery of the Merger
Agreement by Merger Partner, Stockholder desires to agree to vote the Shares (as
defined herein) over which Stockholder has voting power so as to facilitate the
consummation of the Merger;
NOW, THEREFORE, in consideration of the foregoing, intending to be legally
bound, the parties hereto hereby agree as follows:
1. Certain Definitions.
(a) Capitalized terms used but not otherwise defined herein shall
have the meanings ascribed thereto in the Merger Agreement. For purposes of this
Agreement, the following terms shall have the following meanings:
"Constructive Sale" means with respect to any security, a
short sale with respect to such security, entering into or acquiring
an offsetting derivative contract with respect to such security,
entering into or acquiring a futures or forward contract to deliver
such security or entering into any other hedging or other derivative
transaction that has the effect of either directly or indirectly
materially changing the economic benefits or risks of ownership.
"Shares" means (i) all shares of capital stock of Public
Company owned, beneficially or of record, by Stockholder as of the
date hereof, and (ii) all additional shares of capital stock of
Public Company acquired by Stockholder, beneficially or of record,
during the period commencing with the execution and delivery of this
Agreement and expiring on the Expiration Date (as such term is
defined in Section 9 below).
"Transfer" means, with respect to any security, the direct or
indirect assignment, sale, transfer, tender, exchange, pledge,
hypothecation, or the grant, creation or suffrage of a lien,
security interest or encumbrance in or upon, or the gift, placement
in trust, or the Constructive Sale or other disposition of such
security (including transfers by testamentary or intestate
succession or otherwise by operation of law) or any right, title or
interest therein (including, but not limited to, any right or power
to vote to which the holder thereof may be entitled, whether such
right or power is granted by proxy or otherwise), or the record or
beneficial ownership thereof, the offer to make such a sale,
transfer, Constructive Sale or other disposition, and each
agreement, arrangement or understanding, whether or not in writing,
to effect any of the foregoing.
2. Transfer and Voting Restrictions With Respect to the Shares.
(a) At all times during the period commencing with the execution and
delivery of this Agreement and expiring on the Expiration Date, Stockholder
shall not, except as the result of the death of Stockholder or as otherwise
permitted by this Agreement, Transfer any of the Shares, or discuss, negotiate,
make an offer or enter into an agreement, commitment or other arrangement with
respect thereto, unless the person to which such Shares are being Transferred
shall have executed and delivered a counterpart of this Agreement and agreed
pursuant thereto, for the benefit of Merger Partner, to hold such Shares subject
to all terms and conditions of this Agreement.
(b) Stockholder understands and agrees that if Stockholder attempts
to Transfer, vote or provide any other person with the authority to vote any of
the Shares other than in compliance with this Agreement, Public Company shall
not, and Stockholder hereby unconditionally and irrevocably instructs Public
Company to not, (i) permit any such Transfer on its books and records, (ii)
issue a new certificate representing any of the Shares or (iii) record such
vote, in each case, unless and until Stockholder shall have complied with the
terms of this Agreement.
(c) Except as otherwise permitted by this Agreement or by order of a
court of competent jurisdiction, Stockholder will not commit any act that could
restrict or affect Stockholder's legal power, authority and right to vote all of
the Shares then owned of record or beneficially by Stockholder or otherwise
prevent or disable Stockholder from performing any of his, her or its
obligations under this Agreement. Without limiting the generality of the
foregoing, except for this Agreement and as otherwise permitted by this
Agreement, Stockholder will not enter into any voting agreement with any person
or entity with respect to any of the Shares, grant any person or entity any
proxy (revocable or irrevocable) or power of attorney with respect to any of the
Shares, deposit any of the Shares in a voting trust or otherwise enter into any
agreement or arrangement with any person or entity limiting or affecting
Stockholder's legal power, authority or right to vote the Shares in favor of the
approval of the Proposed Transaction.
3. Agreement to Vote Shares.
(a) Prior to the Expiration Date, at every meeting of the
stockholders of Public Company called, and at every adjournment or postponement
thereof, Stockholder (in Stockholder's capacity as such) shall appear at the
meeting or otherwise cause the Shares to be present thereat for purposes of
establishing a quorum and, to the extent not voted by the persons appointed as
proxies pursuant to this Agreement, vote (i) in favor of adoption of the Merger
Agreement and approval of the transactions contemplated thereby (collectively,
the "Proposed Transaction"), (ii) against the approval or adoption of any
proposal made in opposition to, or in competition with, the Proposed
Transaction, and (iii) against any of the following (to the extent unrelated to
the Proposed Transaction): (A) any merger, consolidation or business combination
involving Public Company or any of its subsidiaries other than the Proposed
Transaction; (B) any sale, lease or transfer of all or substantially all of the
assets of Public Company or any of its subsidiaries; (C) any reorganization,
recapitalization, dissolution, liquidation or winding up of Public Company or
any of its subsidiaries that is prohibited by the Merger Agreement; or (D) any
other action that is a breach of any covenant, representation or warranty or any
other obligation or agreement of Public Company under the Merger Agreement or of
Stockholder under this Agreement (each of (ii) and (iii), a "Competing
Transaction").
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(b) If Stockholder is the beneficial owner, but not the record
holder, of the Shares, Stockholder agrees to take all actions necessary to cause
the record holder and any nominees to vote all of the Shares in accordance with
Section 3(a).
4. Grant of Irrevocable Proxy.
(a) Except as set forth in Section 4(f) hereof, Stockholder hereby
irrevocably (to the fullest extent permitted by law) grants to, and appoints,
Merger Partner and each of its executive officers and any of them, in their
capacities as officers of Merger Partner (the "Grantees"), as Stockholder's
proxy and attorney-in-fact (with full power of substitution and
re-substitution), for and in the name, place and stead of Stockholder, to vote
the Shares, to instruct nominees or record holders to vote the Shares, or grant
a consent or approval in respect of such Shares in accordance with Section 3
hereof and, in the discretion of the Grantees with respect to any proposed
adjournments or postponements of any meeting of stockholders at which any of the
matters described in Section 3 hereof is to be considered.
(b) Stockholder represents that any proxies heretofore given in
respect of the Shares that may still be in effect are not irrevocable, and such
proxies are hereby revoked.
(c) Stockholder hereby affirms that the irrevocable proxy set forth
in this Section 4 is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the performance of
the duties of Stockholder under this Agreement. Stockholder hereby further
affirms that the irrevocable proxy is coupled with an interest and may under no
circumstances be revoked. Stockholder hereby ratifies and confirms all that such
irrevocable proxy may lawfully do or cause to be done by virtue hereof. Such
irrevocable proxy is executed and intended to be irrevocable in accordance with
the provisions of Section 212 of the Delaware General Corporation Law.
(d) The Grantees may not exercise this irrevocable proxy on any
other matter except as provided above. Stockholder may vote the Shares on all
other matters.
(e) Merger Partner may terminate this proxy with respect to
Stockholder at any time at its sole election by written notice provided to
Stockholder.
(f) The proxy set forth in this Section 4 shall terminate upon the
termination of this Agreement in accordance with Section 9 hereof.
5. No Solicitation. Stockholder, in his, her or its capacity as a
Stockholder, shall not directly or indirectly, (a) solicit, initiate, encourage,
induce or knowingly facilitate the communication, making, submission or
announcement of any Acquisition Proposal or Acquisition Inquiry or take any
action that could reasonably be expected to lead to an Acquisition Proposal or
Acquisition Inquiry, (b) engage in discussions or negotiations with any Person
with respect to any Acquisition Proposal or Acquisition Inquiry, (c) approve,
endorse or recommend any Acquisition Proposal, or (d) enter into any letter of
intent or similar document or any Contract contemplating or otherwise relating
to any Acquisition Transaction.
6. Action in Stockholder Capacity Only. Stockholder makes no agreement or
understanding herein as a director or officer of Public Company. Stockholder
signs solely in Stockholder's capacity as a record holder and beneficial owner,
as applicable, of Shares, and nothing herein shall limit or affect any actions
taken in Stockholder's capacity as an officer or director of Public Company.
Nothing herein shall prevent or preclude an officer, director or manager of the
Stockholder who is serving as a director of Public Company from taking or not
taking any action in his capacity as a director of Public Company.
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7. Representations and Warranties of Stockholder.
(a) Stockholder hereby represents and warrants to Merger Partner as
follows: (i) Stockholder is the beneficial or record owner of the shares of
capital stock of Public Company indicated on the signature page of this
Agreement free and clear of any and all pledges, liens, security interests,
mortgage, claims, charges, restrictions, options, title defects or encumbrances
except as provided in the Voting Agreement; (ii) Stockholder does not
beneficially own any securities of Public Company other than the shares of
capital stock and rights to purchase shares of capital stock of Public Company
set forth on the signature page of this Agreement; (iii) Stockholder has full
power and authority to make, enter into and carry out the terms of this
Agreement and to grant the irrevocable proxy as set forth in Section 4; and (iv)
this Agreement has been duly and validly executed and delivered by Stockholder
and constitutes a valid and binding agreement of Stockholder enforceable against
Stockholder in accordance with its terms. Stockholder agrees to notify Merger
Partner promptly of any additional shares of capital stock of Public Company of
which Stockholder becomes the beneficial owner after the date of this Agreement.
(b) As of the date hereof and for so long as this Agreement remains
in effect, except for this Agreement or as otherwise permitted by this
Agreement, Stockholder has full legal power, authority and right to vote all of
the Shares then owned of record or beneficially by Stockholder, in favor of the
approval and authorization of the Proposed Transaction without the consent or
approval of, or any other action on the part of, any other person or entity
(including, without limitation, any governmental entity). Without limiting the
generality of the foregoing, Stockholder has not entered into any voting
agreement (other than this Agreement and the Voting Agreement) with any person
with respect to any of the Shares, granted any person any proxy (revocable or
irrevocable) or power of attorney with respect to any of the Shares, deposited
any of the Shares in a voting trust or entered into any arrangement or agreement
with any person limiting or affecting Stockholder's legal power, authority or
right to vote the Shares on any matter (except, in each case, with respect to
the Voting Agreement and the Voting Agreement).
(c) The execution and delivery of this Agreement and the performance
by Stockholder of his, her or its agreements and obligations hereunder will not
result in any breach or violation of or be in conflict with or constitute a
default under any term of any agreement, judgment, injunction, order, decree,
law, regulation or arrangement to which Stockholder is a party and which
Stockholder is aware or by which Stockholder (or any of his, her or its assets)
is bound and which Stockholder is aware, except for any such breach, violation,
conflict or default which, individually or in the aggregate, would not
materially impair or materially adversely affect Stockholder's ability to
perform his, her or its obligations under this Agreement or render inaccurate
any of the representations made by Stockholder herein.
(d) Stockholder understands and acknowledges that Public Company,
the Transitory Subsidiary and Merger Partner are entering into the Merger
Agreement in reliance upon Stockholder's execution and delivery of this
Agreement and the representations and warranties of Stockholder contained
herein.
8. Confidentiality. Stockholder recognizes that successful consummation of
the Proposed Transaction may be dependent upon confidentiality with respect to
the matters referred to herein. In this connection, pending public disclosure
thereof, and so that Public Company may rely on the safe harbor provisions of
Rule 100(b)(2)(ii) of Regulation FD promulgated under the Exchange Act,
Stockholder hereby agrees not to disclose or discuss such matters with anyone
not a party to this Agreement (other than its counsel and advisors, if any, and
the officers, directors, counsel and advisors of Public Company) without the
prior written consent of Public Company and Merger Partner, except for
disclosures Stockholder's counsel advises are required by applicable law, in
which case Stockholder shall give notice of such disclosure to Public Company
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and Merger Partner as promptly as practicable so as to enable Public Company and
Merger Partner to seek a protective order from a court of competent jurisdiction
with respect thereto. The parties understand and agree that to the extent
required by law Stockholder may make a filing on Schedule 13D (or an amended
filing) concerning this Agreement and that such filing will not constitute a
violation of this Section 8.
9. Termination. This Agreement, including without limitation, Section 4,
shall terminate and be of no further force or effect whatsoever as of the
earliest of (a) such date and time as the Merger Agreement shall have been
validly terminated pursuant to the terms of Article 9 thereof, (b) the Effective
Time and (c) June 30, 2009 (the "Expiration Date").
10. Miscellaneous Provisions.
(a) Amendments, Modifications and Waivers. This Agreement may not be
amended or modified except by an instrument in writing signed on behalf of each
of the parties hereto. Any agreement on the part of a party hereto to any waiver
of any term or condition hereof shall be valid only if set forth in a written
instrument signed on behalf of such party. Such waiver shall not be deemed to
apply to any term or condition other than that which is specified in such
waiver. The failure of any party to this Agreement to assert any of its rights
under this Agreement or otherwise shall not constitute a waiver of such rights.
(b) Entire Agreement. This Agreement constitutes the entire
agreement among the parties to this Agreement and supersedes any prior
understandings, agreements or representations by or among the parties hereto, or
any of them, written or oral, with respect to the subject matter hereof.
(c) Governing Law. All matters arising out of or relating to this
Agreement and the transactions contemplated hereby (including without limitation
its interpretation, construction, performance and enforcement) shall be governed
by and construed in accordance with the internal laws of the State of Delaware
without giving effect to any choice or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdiction) that would cause
the application of laws of any jurisdictions other than those of the State of
Delaware.
(d) Submission to Jurisdiction. Each of the parties to this
Agreement (i) consents to submit itself to the exclusive personal jurisdiction
of the Court of Chancery of the State of Delaware in any action or proceeding
arising out of or relating to this Agreement or any of the transactions
contemplated by this Agreement, (ii) agrees that all claims in respect of such
action or proceeding may be heard and determined in such court, (iii) agrees
that it shall not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from such court and (d) agrees not to bring any
action or proceeding arising out of or relating to this Agreement or any of the
transaction contemplated by this Agreement in any other court. Each of the
parties hereto waives any defense of inconvenient forum to the maintenance of
any action or proceeding so brought and waives any bond, surety or other
security that might be required of any other party with respect thereto. Any
party may make service on another party by sending or delivering a copy of the
process to the party to be served at the address and in the manner provided for
the giving of notices in Section 10(m) hereof. Nothing in this Section 10(d),
however, shall affect the right of any party to serve legal process in any other
manner permitted by law.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE
ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND
ENFORCEMENT OF THIS AGREEMENT.
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(f) Attorneys' Fees. In any action at law or suit in equity to
enforce this Agreement or the rights of any of the parties hereunder, the
prevailing party in such action or suit shall be entitled to receive its
reasonable attorneys' fees and all other reasonable costs and expenses incurred
in such action or suit.
(g) Assignment and Successors. Except for any Transfer made in
compliance with Section 2(a) hereof, no party may assign any of its rights or
delegate any of its performance obligations under this Agreement, in whole or in
part, by operation of law or otherwise without the prior written consent of the
other parties, except that Merger Partner, without obtaining the consent of any
other parties hereto, shall be entitled to assign this Agreement or all or any
of its rights or obligations hereunder to any one or more of its Affiliates. No
assignment by Merger Partner under this Section 10(g) shall relieve Merger
Partner of its obligations under this Agreement. Subject to the foregoing, this
Agreement shall be binding upon, inure to the benefit of, and be enforceable by,
the parties hereto and their respective successors and permitted assigns,
including, without limitation, Stockholder's estate and heirs upon the death of
Stockholder. Any purported assignment of rights or delegation of performance
obligations in violation of this Section 10(g) shall be null and void.
(h) No Third Party Beneficiaries. This Agreement is not intended,
and shall not be deemed, to confer any rights or remedies upon any person other
than the parties hereto and their respective successors and permitted assigns,
or to otherwise create any third-party beneficiary hereto.
(i) Cooperation. Stockholder agrees to cooperate fully with Merger
Partner and to execute and deliver such further documents, certificates,
agreements and instruments and to take such other actions as may be reasonably
requested by Merger Partner to evidence or reflect the transactions contemplated
by this Agreement and to carry out the intent and purpose of this Agreement.
Stockholder hereby agrees that Public Company and Merger Partner may publish and
disclose in the Registration Statement and any resale registration statement
relating thereto (including all documents and schedules filed with the SEC) and
the Proxy Statement/Prospectus, such Stockholder's identity and ownership of
Shares and the nature of such Stockholder's commitments, arrangements and
understandings under this Agreement and may further file this Agreement as an
exhibit to the Registration Statement or in any other filing made by Public
Company or Merger Partner with the SEC relating to the Proposed Transaction.
(j) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. If the final judgment of a court of
competent jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the parties hereto agree that the court making such determination
shall have the power to limit the term or provision, to delete specific words or
phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified. In the event such court does
not exercise the power granted to it in the prior sentence, the parties hereto
agree to replace such invalid or unenforceable term or provision with a valid
and enforceable term or provision that will achieve, to the extent possible, the
economic, business and other purposes of such invalid or unenforceable term.
(k) Time of Essence. With regard to all dates and time periods set
forth or referred to in this Agreement, time is of the essence.
(l) Specific Performance; Injunctive Relief. The parties hereto
acknowledge that Public Company and Merger Partner shall be irreparably harmed
and that there shall be no adequate remedy at law for a violation of any of the
covenants or agreements of Stockholder set forth in this Agreement. Stockholder
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accordingly agrees that, in addition to any other remedies that may be available
to Public Company or Merger Partner, as applicable upon any such violation, such
party shall have the right to enforce such covenants and agreements by specific
performance, injunctive relief or by any other means available to such party at
law or in equity without posting any bond or other undertaking.
(m) Notices. All notices and other communications hereunder shall be
in writing and shall be deemed duly delivered (i) four business days after being
sent by registered or certified mail, return receipt requested, postage prepaid,
or (ii) one business day after being sent for next business day delivery, fees
prepaid, via a reputable nationwide overnight courier service, in each case to
the intended recipient as follows: (A) if to Public Company or Merger Partner,
to the address provided in the Merger Agreement, including to the persons
designated therein to receive copies, and (B) if to Stockholder, to
Stockholder's address shown below Stockholder's signature on the signature page
hereof.
(n) Counterparts and Signature. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original but all of
which together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each of the parties hereto and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart. The exchange of copies of this Agreement of
amendments thereto and of signature pages by facsimile transmission or by email
transmission in portable document format, or similar format, shall constitute
effective execution and delivery of such instrument(s) as to the parties and may
be used in lieu of the original Agreement for all purposes. Signatures of the
parties transmitted by facsimile or by email transmission in portable document
format, or similar format, shall be deemed to be their original signatures for
all purposes.
(o) Headings. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
(p) Legal Representation. This Agreement was negotiated by the
parties with the benefit of legal representation and any rule of construction or
interpretation otherwise requiring this Agreement to be construed or interpreted
against any party shall not apply to any construction or interpretation thereof.
(q) Termination of JHP and Archemix Agreements. The Public Company
represents to the Stockholder that on the date hereof, each of (i) the Asset
Purchase Agreement dated as of October 22, 2008 by and between the Public
Company and JHP Pharmaceuticals, LLP and (ii) the Agreement and Plan of Merger
dated as of November 18, 2008 by and among the Public Company, Newport
Acquisition Corp. and Archemix Corp. has been terminated in accordance with its
terms.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly
executed as of the date first written above.
DEERFIELD PRIVATE DESIGN FUND, L.P. HEALTHCARE VENTURES V, LP
By: /s/ Xxxxx X. Xxxxx By: HealthCare Partners V, L.P., its General Partner
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: General Partner By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
DEERFIELD PRIVATE DESIGN INTERNATIONAL, L.P. Name:
Title:
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx 00 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Title: General Partner Xxxxxxxxx, Xxxxxxxxxxxxx 00000-0000
000.000.0000 Fax
DEERFIELD SPECIAL SITUATIONS FUND, L.P.
Shares Beneficially Owned by Stockholder:
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx 1,240,788 shares of Public Company Common Stock
Title: General Partner
DEERFIELD SPECIAL SITUATIONS FUND INTERNATIONAL LIMITED HEALTHCARE VENTURES VI, LP
By: /s/ Xxxxx X. Xxxxx By: HealthCare Partners VI, L.P., its General Partner
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: General Partner By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
NTMD PARENT ACQUISITION CORP.
Name:
By: /s/ Alex Karnal Title:
-----------------------------------------
Name: Alex Karnal
Title: CEO 00 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxxx 00000-0000
NTMD ACQUISITION CORP. 000.000.0000 Fax
By: /s/ Alex Karnal Shares Beneficially Owned by Stockholder:
-----------------------------------------
Name: Alex Karnal
Title: CEO 1,998,810 shares of Public Company Common Stock
With respect to Section 2(b) only:
NITROMED, INC.:
/s/ Xxxxxxx X. Xxxx
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Name:
Title:
